“The Bear Market Economics Phenomenon” is an observation of Political Economics. Wall Street Admits: ‘We Got Rich Off the Backs of Workers’ thus creating the Bear Market. The Bear Market is America's default war.
The ethic of Wall Street is the ethic of celebrity. It is fused into one bizarre, perverted belief system and it has banished the possibility of the country returning to a reality-based world or avoiding internal collapse. A society that cannot distinguish reality from illusion dies.

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Friday, April 22, 2011

Politics: Understanding Who Gets What

With the advent of World War II, business and government became ever more entwined. Occupying top government posts, business leaders were able to set the terms of war production, freezing wages and letting profits soar.1 Immediately after World War II, thousands of government-owned facilities were sold off as "war surplus" for a pittance of their actual value, representing a major transfer of public capital to private business. From the 1950s to today, successive Democratic and Republican administrations have supported the corporate business system with subsidies, tax favors, and military spending programs that transformed the United States into a permanent war economy. Rather than a laissez faire government that allowed the breakdown of business during the Great Depression, we have a corporate state that plays an increasingly active role in sustaining the capital accumulation process.

Welfare for the Rich

In the 1950s, the Eisenhower administration sought to undo what conservatives called the "creeping socialism" of the New Deal by handing over to private corporations some $50 billion (or $200 billion in today's dollars) worth of offshore oil reserves, government owned synthetic rubber factories, public lands, and public power and atomic installations. During this period, the federal government also built a multibillion dollar interstate highway system that provided the infrastructure for the trucking and automotive industries.

The pattern of using the public's money and resources to subsidize private enterprise continues to this day. It is variously estimated that every year, the federal government doles out anywhere from $125 billion to $167 billion in corporate welfare, in the form of tax exclusions, tax credits, reduced tax assessments, excessive depreciation write-offs, price supports, loan guarantees, payments in kind, research and development grants, subsidized insurance rates, marketing services, export subsidies, irrigation and reclamation programs, and research and development grants.2

The government leases or sells—at a mere fraction of market value—billions of dollars worth of oil, coal, and mineral reserves. It fails to collect hundreds of millions of dollars in royalties, interest, and penalties from giant oil companies. It pays out huge sums in unnecessarily high interest rates. It permits billions in public funds to remain on deposit in private banks without collecting interest. The federal government lends out billions at below-market interest rates. It tolerates overcharging by firms with whom it does business, and provides long term credits, and tariff protections to large companies. It pays out billions to reimburse big corporate defense contractors for the costs of their mergers. The government gave away the entire broadcasting spectrum valued at $37 billion—instead of leasing or auctioning it off—representing nearly five times the broadcasting space that the big networks previously controlled.3

Every year, the federal government loses tens of millions of dollars charging ranchers below cost grazing rates on over twenty million acres of public lands; these "ranchers" include a number of billionaires, big oil companies, and insurance conglomerates. Over the past five decades, at least $100 billion in public subsidies have gone to the nuclear industry and many billions worth of federally funded research and development has passed straight into corporate hands without the government collecting a cent in royalties. Companies mine valuable minerals and metals from federal lands without paying royalties, sometimes with the right to purchase the land title for a nominal fee.4

The U.S. Forest Service has built almost 400,000 miles of access roads through national forests—eight times the size of the entire federal interstate highway system. Used for the logging operations of timber companies, these roads can cause massive mud slides that contaminate water supplies, ruin spawning streams, and kill people. After the timber companies clear-cut an area, the government then replants trees, costing the taxpayers additional millions annually.

The U.S. government's Agency for International Development (AID), spent $1 billion in taxpayer money over the past decade to help companies move U.S. jobs to cheaper labor markets abroad. AID provided low interest loans, tax exemptions, travel and training funds, and advertising. AID also furnished blacklists to help companies weed out union sympathizers from their work forces in various countries.

In any one year, subsidies totaling between $5 and $6 billion go to agribusiness producers of feed grain, wheat, cotton, rice, soy, dairy, wool, tobacco, peanuts, and wine, with relatively little going to small agrarian producers. Subsidies to big commercial farms encourage wasteful water practices and increased toxic runoffs into rivers and bays from pesticides, herbicides, and chemical fertilizers. The General Accounting Office (GAO) estimates that agribusiness enterprises that use legal loopholes to circumvent subsidy limits, yearly collect more than $2 billion in unjustified farm program payments.5

The federal government has subsidized exporters of iron, steel, textiles, tobacco, paper, and other products, along with the railroad, shipping, and airline industries. The government paid 92 percent of the $3.7 billion invested in expanding the airline industry from 1940 to 1944.6 It doles out huge amounts in grants and tax "incentives" to the big companies to encourage oil exploration. Several major petroleum companies leased acreage in Alaska for oil exploration, paying $900 million for lands that were expected to yield $50 billion.

Whole new technologies are developed at public expense—nuclear energy, electronics, aeronautics, space communications, mineral exploration, computer systems, biomedical genetics, and others—only to be handed over to industry for private gain. Thus, AT&T managed to have the entire satellite communications system put under its control in 1962 after U.S. taxpayers had put up the initial $20 billion to develop it. The costs are socialized; the profits are privatized.

Under corporate state capitalism the ordinary citizen pays twice for most things: first, as a taxpayer who provides the subsidies and supports, then as a consumer who buys the high priced commodities and services. Numerous medications marketed by the pharmaceutical industry have been paid for in whole or part by taxpayers—who often then cannot afford the high prices charged, even though the drug may not have been all that expensive to produce.

Federal Bailouts, State and Local Handouts

Billions of taxpayers' dollars go to bail out giant companies like Chrysler and Lockheed, while small businesses are left to sink or swim on their own. When one of the nation's largest banks, Continental Illinois, was on the brink of failure, it received $7.5 billion in federal aid. Another $8 billion went to the International Monetary Fund to offset the losses incurred by U.S. banks in bad loans to Third World nations. The government spent billions to "rescue the Mexican peso"—really a bailout for wealthy Wall Street firms and banks that made bad investments in Mexican bonds.7

In the late 1980s and early 1990s, the government put over $500 billion into bailing out the savings and loan (S&L) associations. Under the deregulated thrift market adopted during the Reagan years, S&Ls could take any investment risk they wanted with depositors' money, often at great profit to themselves, with the understanding that failures and bad debts would be picked up by the government. In many instances, thrift industry heads funneled deposits directly into personal accounts, executive salaries, or fraudulent deals—sometimes involving organized crime and the CIA.8 When hundreds of thrifts failed, the government compensated depositors, 90 percent of whom held accounts of $100,000 or more, in what amounted to the biggest bailout and financial scandal in human history. The people hurt the most are the ordinary taxpayers who are paying $101 billion a year for the S&L bailout, and will continue to pay that amount for another twenty-five years or so.

The government has spent billions bailing out hedge funds—at a time when Congress was tightening bankruptcy rules for ordinary citizens. Hedge funds allow the wealthy to evade all regulation while putting their money in the riskiest investments (which because they are risky offer high returns). When the investments fail, the hedge fund falls into a federal safety net. Once more, fat cats walk away fully compensated and the taxpayers are stuck with the bill.9

State and local governments also let big business feed at the public trough. They compete with each other in attracting new businesses and keeping old ones from leaving. In 1999 Pennsylvania gave $307 million to a Norwegian engineering firm to open a shipyard in Philadelphia; Alabama gave $253 million to Mercedes-Benz (now Mercedes-Benz/Chrysler) to build an assembly plant, including a $30 million training school—in an area where public schools were under financed and overcrowded. North Carolina annually gives tens of millions of dollars to the insurance and banking industries. California has handed out billions in tax-exempt bond-financing to Shell, Mobil, Chevron, PG&E, and other transnational corporations, while New York City gave huge tax breaks to General Motors, Merrill Lynch, Disney, and dozens of other rich companies. In cities across the country, taxpayers were being made to pay hundreds of millions for new sports stadiums, while the wealthy owners of professional teams pocketed record profits.10

State and local governments also provide business with low interest loans, tax free investment opportunities, special zoning privileges, and below market land sales. They regularly waive environmental regulations to attract business. Eugene, Oregon, provided $12 million for a corporation to cut down an impressive stand of historic giant trees and build a parking garage and apartments. Such expenditures are justified as necessary to create new jobs. Yet new jobs rarely materialize in any appreciable numbers. For example, Baton Rouge, Louisiana, gave Exxon a $14 million tax break in exchange for a net gain of one job (by Exxon's own estimate). Michigan gave a company $81 million to build a mill that created only thirty-four permanent jobs—at $2.3 million per job.11

Several hundred thousand firms illegally retain billions of dollars each year in Social Security and withholding taxes from their employees paychecks. Relatively few of them have been prosecuted.12 Over one hundred of the largest private utilities annually collect taxes on their monthly billings to customers, but by taking advantage of write-offs and loopholes, they are able to pocket most of what they collect. In various states, state legislatures have approved multibillion dollar bond sales that force taxpayers to bail out utility companies for bad investments made in nuclear power plants.13

In sum, free market advocates, who constantly admonish the poor to lift themselves by their own bootstraps, are the first to turn to governments at all levels for handouts, bailouts, special services, and privileged protections.

Taxes: Helping the Rich in Their Time of Greed

The capitalist state uses taxation as well as public spending to redistribute income in an upward direction. Taking into account all taxes at the federal, state, and local levels, as well as Social Security payments, we find that lower income people pay a higher average percentage of their earnings (12.5 percent) than do the richest (7.9 percent).14 The higher the income, the greater are the opportunities to enjoy lightly taxed or tax free income, including tax free state and municipal bonds and tailor made write offs.

In the last two decades, income from property ownership (dividends, interest, rents) has risen three times faster than income from work. The rich have grown richer, while their tax burden has grown lighter. The Internal Revenue Service (IRS) reports that thousands of U.S. residents in the highest bracket pay less than 5 percent of their income in taxes. Almost 2,400 paid no taxes at all in the mid 1990s; and the number has been growing since then.15 In 1991, billionaire presidential contender Ross Perot pocketed $285 million from his investments and paid $15 million in federal taxes, quite a large sum, yet it represents only about 6 percent of his earnings. Meanwhile, a school teacher who makes $35,000 might pay only $6,500 in federal income tax, much less than Perot; yet that sum represents upwards of 20 percent of her modest salary, and does not count the regressive sales and excise taxes and state income tax she also must pay. Still, the regressive principle seems to hold: the higher the bracket, the lower the actual rate after deductions and write-offs.

Each year a dozen or more billionaires give up their U.S. citizenship and move to the Bahamas or other offshore tax havens, thereby saving millions on income and estate taxes.16 (They are still allowed to spend 124 days a year in the United States.) Many of the superrich employ various stratagems to evade capital gains taxes (the federal tax on profits from the sale of stock, land, or other assets). Most capital gains taxes are now paid by smaller investors who own mutual funds.17

Corporations too are making more money and paying less taxes. The proportion of federal revenues coming from corporate taxes has dropped from 50 percent in 1945 to less than 8 percent today. The resultant revenue loss is made up by an increase in taxes on the middle and working classes and greater government borrowing. Corporations can deduct for production costs, overhead wages, marketing expenses, advertising, business conferences, and moving costs. They can write off business meals, travel and entertainment, investment incentives, operational losses, interest payments, and depreciation. They shift profits to overseas branches in low-tax countries. They indulge in tax shelters so complex that government auditors sometimes cannot properly trace them. They incur merger and acquisition costs that are then written off as deductions. And they dispatch lobbyists to Washington to pressure Congress for still more tax breaks. The result is that, in 1998, a company like General Motors, the largest corporation in the United States, while reporting $4.61 billion in profits, paid the IRS less than 1 percent in taxes.18 If employees stock options in a company go up in value, the company can treat those gains as a deduction. This enabled Cisco Systems, the big maker of Internet-switching gear, to make $2.67 billion in profits in 2000 and pay almost no federal income tax. Microsoft also got a huge stock option deduction.19

Media tycoon Rupert Murdoch avoids paying taxes on his U.S. holdings, though they account for the greater part of his immense fortune. In any one year, he siphons off many millions in state-side profits to his subsidiary in the Netherlands Antilles, a place that has virtually no income taxes. In addition, the $1.8 billion he paid to acquire U.S. television stations is written off against profits, further reducing his taxable income.20 In effect, Uncle Sam helps to pay for Murdoch's growing media empire.

Under the Internal Revenue Code, over five hundred firms operating in Puerto Rico bring the profits back to their U.S. parent companies tax-free. (Puerto Rico is a U.S. colony where nearly two-thirds of the population live in poverty.) American owned shipping companies incorporated in foreign countries are exempted from U.S. income taxes. Corporate overseas profits that are not repatriated are tax-exempted. Oil and mineral royalties that firms pay abroad can be treated as tax credits at home. A tax credit is even better than a tax deduction. A $5,000 deduction means that $5,000 of your income can be treated as nontaxable, saving you $1,550 (at a 31 percent tax rate). But a $5000 tax credit allows you to subtract that amount from the actual taxes you have to pay, saving you $5,000. The royalties that Exxon and Mobil give to Saudi Arabia for the oil they extract from that country are treated as a tax credit, directly subtracted from the taxes the companies would have paid to the U.S. government.

A working mother with two children, earning $15,000, pays more taxes in a year than any number of giant transnational corporations. Even as they brag to stockholders of record profits, over 60 percent of U.S. corporations pay no income taxes, according to a report from the General Accounting Office (GAO), the investigative agency of the U.S. Congress.21

It has been argued that taxing the wealthy more heavily would make no appreciable difference in federal revenue since they are relatively few in number. In fact, if rich individuals and corporations paid a graduated progressive tax of 70 percent, as they did twenty years ago, with no loopholes or shelters, hundreds of billions of additional dollars would be collected yearly and the national debt could be swiftly and substantially reduced. Just the deductions that corporations claim for the interest on their business loans costs the government nearly $100 billion a year in lost revenue. These are not trifling sums.

Responding to pressure from conservative lawmakers in Congress, the IRS has increased its focus on the poorest Americans and smallest businesses while paying less attention to richer people and larger companies. Among taxpayers making $100,000 or more, only 1.1 percent were audited in 1999, down from 11.4 percent five years earlier. Most working people have their taxes deducted from their paychecks and thereby are deprived of any opportunity to fudge their tax bill. Reduced IRS surveillance creates greater opportunities for evasion principally for those who enjoy a business income and who can resort to creative deductions and imaginative bookkeeping. This includes some of the biggest companies in the world. Yet the IRS reduced corporate audits substantially.22 One reason the rich are paying so much less is the drop in auditing imposed on them.

Unkind Cuts, Unfair Rates

Most of the "tax reforms" produced by Congress are paraded as relief for the besieged middle class when actually they mostly benefit the higher-income brackets. Thus, for every dollar in tax cuts accorded the bottom 80 percent, the Taxpayer Relief Act of 1997 gave $1,189 to the wealthiest 1 percent. In fact, the poorest 60 percent received next to nothing in relief.23 To help pay for these upper-income tax breaks, Congress slashed the modest allocation slated for rebuilding rundown schools.24 Likewise the "middle-class tax plan" before Congress in 2000 offered the lion's share of cuts to the very richest.25

There are several ways people can be taxed. A progressive income tax imposes a substantially higher effective tax rate on the rich, based on the principle that taxes should fall most heavily on those who have the greatest ability to pay. Thus, in 1980 the very richest paid a 70 percent tax rate and the poorest only 18 percent. That rate is not as severe as it sounds, for it did not apply to one's entire income. The tax was graduated so that the rich paid the 70 percent rate only on the uppermost portion of their income. In addition, they continued to enjoy various deductions.

A proportionate income tax, or "flat tax," imposes the same rate on everyone, regardless of ability to pay. Its proponents argue that a flat tax brings simplicity and clarity to the tax code. Instead of the rich paying 70 percent and the poor paying 15 percent, which is supposedly all too complicated for us to grasp, we would all pay 17 percent or whatever; this way we ordinary folks would be less confused. A flat tax would lower the taxes on wealthier Americans and raise taxes on just about everyone else.

Those who advocate a progressive tax consider the flat tax to be unfair, for while everyone is paying the same rate, and the richer person is paying more dollars, the poorer person is being cut closer to the bone. If both rich and poor pay, say, 20 percent of their income, then a person who earns $10,000 pays $2,000 in taxes and has only $8,000 to live on, while one who makes $1 million pays $200,000 but still has $800,000. A dollar taken from someone of modest means has a greater deprivation impact than even a thousand dollars taken from the super rich. Furthermore, most flat tax proposals would tax wages and pensions but not dividends, interest, capital gains, corporate profits and large inheritances.26

A regressive tax is even more unfair than a flat tax, for it imposes the highest effective tax rate upon those who have the least. Instead of paying the same rate as in a flat tax, rich and poor pay the very same amount. When both a janitor and a top executive pay the exact same tax on a gallon of gas, the janitor is sacrificing a far greater portion of income than the executive. Sales and excise taxes are highly regressive.27

Some conservatives advocate a national sales tax to replace the income tax. This would be most regressive of all. To raise as much as does the current income tax, we would have to pay an estimated 30 percent sales tax on most products, a regressive burden that would cost 90 percent of families vastly larger portions of their disposable income. As Senator Richard Lugar (R-Ind.) conceded when proposing a national sales tax: "I admit that if the point of taxation is progressivity or so-called fairness and redistribution, then my plan will not be your cup of tea."28

Some lawmakers advocate a value added tax, which is just a more covert and complicated version of a national sales tax. Taxes would be added at every stage of production and distribution (leaving businesses with about as much paperwork as they have now), with the consumer paying the full tab at the end of the line.

Then there is the estate tax or inheritance tax, which is very progressive, since it applies only to inheritances of over $1 million. In the decade ahead, scions of the wealthiest families in the United States, the top 1 percent or so, stand to inherit at least several trillion dollars. In 2000, a Republican-led Congress voted to repeal the estate tax, which if it had not been vetoed by Clinton would have given the superrich an extra $105 billion in the first ten years as the tax was phased out and then $750 billion in the decade after the tax is repealed, most of which would have gone to the top one-tenth of 1 percent of the population.29

Taxes are even more regressive at the state and local levels. In forty five of fifty states, the poorest 20 percent of the population pay higher state and local rates than the richest 1 percent. For example, in Washington State, the poor pay 17.4 percent in state and local taxes, while the rich pay only 3.4 percent; in Texas, the difference is 17.1 to 3.1; and in Connecticut, 11.9 to 4.2.30 In the early 1990s, state sales and excise taxes which hit low-income people proportionately harder, were raised almost $12 billion. By mid-decade the states began cutting state income taxes, making state tax systems still more regressive.

Deficit Spending and the National Debt

When government expends more than it collects in revenues, this is known as deficit spending. To meet its yearly deficits, it borrows from wealthy individuals and financial institutions in the United States and abroad. The accumulation of these yearly deficits constitutes the national debt.

By 1940, given the deficit spending of the New Deal, the national debt had grown to $43 billion. The cost of World War II brought it to $259 billion. By 1981, it had climbed to $908 billion. Conservative leaders who sing hymns to a balanced budget have been among the wildest deficit spenders. The Reagan administration in eight years (1981-88) tripled the national debt to $2.7 trillion. During the next four years, the Bush administration brought the debt to $4.5 trillion. By early 2000, it had climbed to over $5.7 trillion—the amount that today's taxpayers (and future generations) owe to rich bondholders and financial institutions.

In 1993, the federal government's yearly payouts on the national debt came to $210 billion. By the end of the decade, payments had climbed to about $350 billion. Several things have contributed to the growing national debt:

First, the billions of dollars in tax cuts to wealthy individuals and corporations represent lost revenue that is made up increasingly by borrowing. The government borrows furiously from the moneyed interests it should be taxing.

Second, there is the budget busting impact of immense military spending. In twelve years, the Reagan-Bush expenditures on the military came to $3.7 trillion. In eight years, Bill Clinton spent over $2 trillion on the military.

Third, the national debt itself contributes to debt accumulation, growing at an increasing rate, so that the interest paid on the national debt has been expanding faster than the economy and twice as fast as the budget. Every year, a higher portion of debt payment has been for interest alone, with less and less for retirement of the principle, the debt itself. By 1990, over 80 percent of all government borrowing went to pay for interest on money previously borrowed. Thus, the debt becomes its own self feeding force. The interest paid on the federal debt each year is the second largest item in the discretionary budget (after military spending).

To borrow money, the government sells treasury bonds. These bonds are promissory notes that are repaid in full after a period of years. Who gets the hundreds of billions in yearly interest on these bonds? Mostly the individuals, investment firms, banks, and foreign investors with money enough to buy them. Who pays the interest? Mostly ordinary U.S. taxpayers. Interest payments on the federal debt constitute an upward redistribution of wealth from those who work to those who live off personal wealth. Moneyed creditors lend their surplus capital to the U.S. government and watch it grow risk free at public expense, backed by the "full faith and credit" of the U.S. government, just as the framers of the Constitution intended. We the people will be servicing this astronomical debt for generations to come. As Karl Marx wrote, "The only part of the so called national wealth that actually enters into collective possessions of modern peoples—is their national debt."31

The debt serves the capitalist class well. Instead of capitalists investing their accumulated wealth in new production that would glut the market and remain unsold, they invest in U.S. Treasury bonds to accumulate interest. Lending money to the government becomes a relatively risk-free but profitable investment at a time when investment opportunities are lagging because of stagnant consumer demand or are increasingly chancy because of a volatile market.

By 2000, the economic boom had brought about a budget surplus for the first time. Rather than demanding that the surplus be used to reduce the debt, GOP leaders in Congress called for additional cuts in taxes for the wealthy. To justify such tax breaks they predicted unbridled growth and enormous budget surpluses in the decade ahead, conveniently overlooking the possibility of sudden economic downturns.

Some Hidden Deficits

Predictions of large budget surpluses also overlook the additional but hidden deficits that exist. First, there is the "off budget" deficit, an accounting gimmick that allows the government to borrow additional billions outside the regular budget. A government created (but nominally "private") corporation is set up to borrow money in its own name. For instance, monies to subsidize agricultural loans are raised by the Farm Credit System, a network of off budget banks, instead of being provided by the Agriculture Department through the regular budget. Congress also created an off budget agency known as the Financing Corporation to borrow the hundreds of billions needed for the savings and loan bailout, instead of using the Treasury Department. These sums are taken out of the general revenue, compliments of the U.S. taxpayer.

Another hidden deficit is in trade. As we consume more than we produce and import and borrow from abroad more than is exported, the U.S. debt to foreign creditors increases. Interest payments on these hundreds of billions borrowed from abroad have to be met by U.S. taxpayers.

Social Security also is used to disguise the real deficit. The Social Security payroll deduction—a regressive tax—soared during the Reagan years, and today produces a yearly surplus of over $120 billion. By 1991, 38 percent of U.S. taxpayers were paying more in Social Security tax than in federal income tax. Many Americans willingly accept these payroll deductions because they think the monies are being saved for their retirement. In fact, Social Security taxes are used to offset deficits in the regular budget, paying for White House limousines, jet bombers, corporate subsidies, and interest on the debt.

U.S. political leaders have assiduously ignored the surest remedies for reducing the astronomical national debt: (a) sharply reduce individual and corporate tax credits and deductions, (b) reintroduce a progressive income tax that would bring in hundreds of billions more in revenues; and (c) greatly reduce the bloated military budget and redirect spending toward more productive and socially useful sectors of the economy.

To summarize the main points of this chapter: In almost every enterprise, government has provided business with opportunities for private gain at public expense. Government nurtures private capital accumulation through a process of subsidies, supports, and deficit spending and an inequitable tax system. From ranchers to resort owners, from brokers to bankers, from auto makers to missile makers, there prevails a welfarism for the rich of such stupendous magnitude as to make us marvel at the corporate leaders' audacity in preaching the virtues of self reliance whenever lesser forms of public assistance threaten to reach hands other than their own.

Zepezauer and Naiman, Take the Rich Off Welfare, 75-77; "Department of Interior Looks the Other Way," Project on Government Oversight Reports, April 1995; and "The Airwaves: Al Gore's Amazing Gift," Nation, March 10, 1997.

Bartlett and Steele, "Corporate Welfare"; survey of thirty cities by the U.S. Conference of Mayors, reported in San Francisco Bay Guardian, October 6, 1999; Joanna Cagan and Neil deMause, Field of Schemes: How the Great Stadium Swindle Turns Public Money into Private Profit (Monroe, Me.: Common Courage Press, 1998).

GAO report, San Francisco Examiner, April 15, 1999; Paul Sweeny, "Profiting from Tax-Proof Companies," New York Times, April 5, 1998.

"IRS Shifts Audit Focus from Rich to Poor," AP report, April 16, 2000; David Cay Johnston's reports in New York Times, April 13 and 18, 1997.

Congressional Budget Office statistics reported in New York Times, April 5, 1998.

"Money for Nothing," Nation, September 1, 1997, 5.

CTJ News, Citizens for Tax Justice, Washington, D.C., July 1999.

CTJ Update, Citizens for Tax Justice, November 1997.

A sales tax is a fixed rate imposed on a wide range of products and services uniformly. An excise tax is imposed on a specific product at a specific rate: a gasoline tax and a cigarette tax are excise taxes.

Quoted in Tax Notes, July 31, 1995.

New York Times, September 1, 2000; and CTJ Update, April 2000.

"Who Pays? A Distributional Analysis of the Tax Systems in All 50 States," Citizens for Tax Justice, June 2000: http://www.ctj.org.

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The Bear Market Dynamic

Our faith in capitalistic institutions promotes the pretense of democracy, while it delivers plutocracy, corporate fascism, and militarism. Similarly, imprudent belief in the American Dream induces people to behave in ways that promote the welfare of those in power rather than the perspectives of those of us struggling to be free. Belief in this discredited notion keeps workers from organizing against their oppressors.

“Bear Market Economics” is an expression of Political Economics, an interdisciplinary field focusing on the non-market, collective, and political activity of individuals and organizations. Specific fields of inquiry include regulation, distributive politics, elections, corporate politics, public policy, social welfare, scientific and science policy, political participation and collective action, interest groups, constitutional choice, legislative behavior and organization, judicial institutions, bureaucracies, comparative institutions, cooperative political economy, macro political economy, allocation of resources, the environment, ecology, law and economics, business and government, how markets affect and impact the public and the commons. The orientation to these topics tends to be positive rather than normative.

FAIR USE NOTICE

This site may contain copyrighted material the use of which has not always been specifically authorized by the copyright owner. We are making such material available in an effort to advance understanding of environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. we believe this constitutes a ‘fair use’ of any such copyrighted material as provided for in section 107 of the US Copyright Law.

In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml

If you wish to use copyrighted material from this site for purposes of your own that go beyond ‘fair use’, you must obtain permission from the copyright owner.

The American Capitalist Way

Capitalism is preferentially identified by its euphemisms: "Free Enterprise," "market system," "private enterprise." "the American Way," etc. Overt and pervasive partisanship in support of capitalism is not regarded by the American media as an ideological bias negating professional "objectivity" but rather comparable to the serene acceptance of natural laws.